economic expense: schweser practive vol1, exam2, q95 afternoon, economic, practice, include

Ionutzakis

schweser practice vol1, exam 2 afternoon session , q95i
is the formula for IFRS? if under GAAP, when calculate economic expense, do we also include actuarial gain/loss? thanks

Iginla2010

economic expense has nothing to do with accoutning rules so it doesn’t matter if it’s IFRS or GAAP.
I think you add actuarial gain/loss just like plan amendments

bkballa

You don’t add actuarial G/L, economic expense is just:
Interest cost + Service cost - Actual Return on Plan assets
Ref: 2008 secret sauce

bleach

These formulae are better:
1. Change in PBO + Benefits Paid - Actual Return in Plan Assets
2. Change in Funded Status (Begin - End) + Employer Contributions

lunarfollies

deep2002 is incorrect page 104 of CFAI book.
cpk123 in the second formula you need to subtract contributions not to add them.

Kapie

your right,
You should add/subtract current period actuarial losses (gain) in my formula.
CP:
I have Change in funded status (End - Begin) - contributions

anshultongia

End - Begin - Employer Contributions= Economic Pension Expense will give you a negative number, but it’s the same formula that cpk gave; he did the reverse:
Begin - End + Employer Contributions

economicz

deep2002 Wrote:
——————————————————-
You don’t add actuarial G/L, economic expense is
just:
Interest cost + Service cost - Actual Return on
Plan assets

Ref: 2008 secret sauce
No, you do add the actuarial gain/loss to arrive at economic pension expense (see the schweser exam 2pm question)